Almirall and Eloxx Pharmaceuticals have entered into an exclusive agreement to licence the phase 1-ready asset ZKN-013 for rare dermatological diseases, with the deal worth more than $470m.

ZKN-013 is an oral therapy designed to overcome nonsense mutations that cause a premature stop codon, resulting in nonfunctional protein production.

This occurs in rare skin diseases such as recessive dystrophic epidermolysis bullosa and junctional epidermolysis bullosa, as well as the rare gastrointestinal disease familial adenomatous polyposis.

Under the terms of the agreement, Eloxx will receive $3m and additional payments from Almirall throughout the potential development phases, including regulatory and sales milestones of up to $470m, as well as tiered royalties.

In exchange, Almirall will gain global rights to develop and commercialise ZKN-013 for the treatment of rare dermatological and other diseases associated with nonsense mutations.

Karl Ziegelbauer, executive vice president, research and development, and chief scientific officer of Almirall, said: “This licence agreement is aligned with Almirall’s research and development strategy to develop novel treatments to help people with dermatological conditions, including rare diseases.

“We look forward to progressing the development of ZKN-013 to find a potentially impactful solution for patients suffering from rare and devastating diseases caused by nonsense mutations.”

Sumit Aggarwal, Eloxx’s president and chief executive officer, said the company believes ZKN-013 “has the potential to have a significant impact on the treatment of these painful and debilitating diseases”.

ZKN-013 is Eloxx’s lead asset designed through its TURBO-ZM platform, which uses chemistry technology to develop novel ribosome modulating agents to target the human ribosome to develop new potential therapeutics.

“In addition to advancing [the] development of ZKN-013, this agreement will allow Eloxx to remain focused on fully maximising the potential of ELX-02 in rare kidney diseases and continue funded discovery efforts on our TURBO-ZM platform,” Aggarwal said.